Thursday, January 4, 2018

Auditing Brand Performance

One of the most critical factors in strategic planning is aligning the brand to the demands of the market.  It is also one of the most neglected tasks: insiders believe that they know what is important, that the customer share their perspective, and that the brand is already associated to the qualities most desired by the market.   This is often done without auditing the brand’s performance in the mind of the market – and as a result, it is often tragically wrong.

Foundational Research

The foundational research for a brand performance begins with qualitative research: ask a balanced blend of individuals who purchase your brand, individuals who purchase other brands, and prospects who have not yet purchased the product, “what qualities are important to you when shopping for [product]?”   

Then, in a qualitative study, ask separate groups of people to answer the following questions:

How important is [quality] when you are shopping for [product]?
To what degree does [brand] deliver [quality]?

It’s important to ask separate groups these questions, as answering both in a single session will likely corrupt the study (their answer to the second question will be tainted by their desire to be consistent with the answer they gave to the first).

The Audit Graphic

Creating a meaningful graphic is a simple matter of plotting each quality on a graph: the horizontal placement of the quality corresponds to the degree to which respondents consider it important and the vertical placement corresponds to the degree they feel it is already associated to your brand.   Then, draw a line (in blue in the example) that marks the 75% point on both axes, splitting the graphic into four quadrants:

Quadrant A represents brand strengths.  These are the qualities that customers care about very much, and they already believe that your brand delivers upon them.   You have already achieved these goals, should spend a little as necessary to maintain them, and should be very cautious about any initiative that would jeopardize them.

Quadrant B represents brand weaknesses.  These are qualities that customers care about, but your brand does not deliver.   This should be the primary focus of strategic efforts – either to modify the product to deliver these qualities or focus advertising messages to convince the market that your brand already does deliver upon them.

Quadrant C represents waste.  These are qualities that are not important to the customer, but are highly associated to your brand.  Chances are that the firm undertook considerable effort and expense to deliver these qualities, and that their achievement does nothing for performance.   These are areas in which you can cut back and employ the budget in more productive ways.

Quadrant D represents potential misdirection.   The qualities are not important to the customer and not important to the brand, and it would be a mistake to pursue them.   Convincing the customer it is important will move them into quadrant B, investing in them will move them into quadrant C, and attempting to do both is perhaps overly ambitious.

Extending the Use of the Audit Graphic

There are two other ways in which the brand performance audit can be used:

First, conduct a brand performance audit of a competitor – preferably one that is outperforming your firm in the mind of the market.   This will help to identify the reasons that customers value their brand over yours.

Second, conduct an internal brand performance audit – that is, ask insiders rather than customers what they think.   This will help to identify critical misperceptions within the culture of your own firm that are causing time and money to be spent on the wrong things.

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